China making 3G progress

March 28, 2005

China's home-grown 3G mobile technology TD-SCDMA will be industrialised by the end of June 2005 as scheduled said an official from the Ministry of Information Industry, according to local reports.

Han Jun, deputy director of the Department of Science and Technology with the Ministry of Information Industry, said 3G equipment ranging from base stations to handset terminals will be industrialised by the end of June.

In a separate report, the National Business Daily said the Chinese government will grant 3G licenses to China Mobile, China Netcom and China Telecom for a price of 20 billion yuan each, citing industry sources.

The report said China Unicom would be split into two parts - a GSM network and a CDMA network. The GSM network will be combined with China Telecom and while the CDMA network integrated with China Netcom, the source said.

The move follows concerns that issuing four 3G licenses to state-owned operators would require excessive investment from the state.

China represents the world's largest mobile phone market and firms are eager to get a slice of the 3G action. So far, the government has resisted demands to issue 3G licenses in a hope to get TD-SCDMA as mature as possible.

The latest player to express concerns over the delay in issuing licenses is Gao Yan, president of Mobile Networks with Siemens (China) Communications. He said China should rollout 3G as soon as possible to keep up with 3G development worldwide.

"I believe both telecom operators and equipment providers and handset terminal makers are ready for the take off of 3G in China," he told China Daily in an interview.

He said, "it has become very clear that 3G should be kicked off soon if China is to keep pace with the development of 3G worldwide."

Siemens recently announced a joint venture with Huawei Technologies, named TD Tech, to develop products based on TD-SCDMA. Siemens holds a 51% stake in the US$100 million joint venture with Huawei taking the remainder.